Four Reasons to Watch the Adani Case

Sometimes a tale of corporate corruption comes along that perfectly captures all the issues that ethics and compliance professionals face in our line of work. Such is the case with the Adani Group, and compliance officers everywhere should watch it closely; it could be a hugely telling case for corruption enforcement in 2025. 

By now you’ve probably heard the basics. On Nov. 20, the U.S. Justice Department and the Securities and Exchange Commission brought charges against Gautam Adani, head of the Adani Group and one of the richest men in India; and a half-dozen of his business associates. All were accused of funneling more than $250 million in bribes to various government officials in India, in exchange for winning lucrative contracts to provide solar power across the country. 

The Justice Department filed criminal charges of securities and wire fraud against Adani and his nephew, Sagar Adani. The department also filed criminal FCPA charges against five other men who were business associates of the Adanis, although not against the Adanis themselves nor against the Adani Group as a company. The SEC, meanwhile, filed civil securities fraud charges against both Adanis, and civil FCPA charges against one of their associates; but again, no FCPA charges filed against the Adanis themselves or the Adani Group.

So why should compliance professionals watch this case? What makes it so interesting, and so portentous for corruption enforcement in 2025? 

For four reasons, both great and small. Let us count the ways.

Reason 1: The Political Dimension

Foremost, compliance officers should watch this case to see whether Gautam Adani or the Indian government try to persuade the Trump Administration to drop the case. If the Administration does, that could be a gut-punch to the rule of law.

Quite simply, Adani is a rich and well-connected man. His net worth is estimated at $84 billion, and he is a close friend and confidant of India prime minister Narendra Modi. If anyone could buy their way out of a corruption prosecution — either by asking Modi to exert influence with President-elect Trump, or just by donating money to Trump directly — Adani could. 

I have no idea whether Adani actually would do either of those things; so far, his company says the charges against him are “baseless and denied,” and Adani himself said over the weekend that his business is committed to “world-class regulatory compliance.” But the compliance community would be naive to dismiss the potential here, especially with a transactional president like Trump at the helm.

That’s the real issue, after all: whether Trump will allow Justice Department prosecutors to continue this case, or whether he’ll intercede to further some other political or financial interest he has. For example, if Adani did make some large contribution to a Trump cause in exchange for dismissal of the case; or if Modi argued that the Adani Group should avoid prosecution because it can provide valuable energy infrastructure goods while China is under sanctions — the Trump Administration would be admitting that political favoritism can trump (no pun intended) enforcement against corruption. 

What signal does that send to the compliance community? How are we supposed to take Justice Department officials seriously when they deliver speeches talking about rigorous enforcement or the benefits of self-disclosure or any other of the usual refrains? Why listen to those songs when the picture in front of you is so starkly different? 

I even wonder if that’s why the Biden Administration brought these charges now: to put the incoming Trump Administration in an awkward position, where it must either proceed with a high-profile case or burn its future credibility. We shall see.

Reason 2: The Legal Dimension

I also love this case because so far all we have are charges, not a settled resolution. Assuming the Trump Administration does proceed with the case and Adani doesn’t try to wriggle free by calling in favors, we’ll get to see pre-trial motions and rulings and a trial and lots more fun stuff. How often does that happen around here? 

For example, maybe we’ll find out why Adani and his nephew weren’t charged with FCPA violations like their co-conspirators were. Is the case against them not as strong as it is against the others? Did someone high up in the Justice Department (read: attorney general Merrick Garland) block FCPA charges from being filed? Did the State Department intercede for political reasons? Right now, we don’t know. Maybe the answers will come to light as we proceed to trial.

Another detail is that the misconduct alleged in the criminal indictment happened as recently as earlier this year. So could we see other charges filed against the Indian government officials who took the alleged bribes, under the recently enacted Foreign Extortion Prevention Act? 

FEPA was enacted by Congress at the end of 2023, so any corruption that happened after that date could be fair game for prosecution by U.S. authorities. The compliance world hasn’t yet seen a FEPA enforcement action, and I don’t know that we’ll see one now; charging political allies of Modi, who is an important ally to the United States, seems like an exceptionally delicate matter. Then again, if Modi were to leave office and other parties take over, things might change. 

FEPA aside, we should still remember that actual court rulings and case law on foreign corruption prosecutions are exceedingly rare. Usually the target companies or individuals settle, and then we pore over the settlement documents like tea leaves. Perhaps this case will go all the way to trial, verdict, and case law. Crazier things have happened.

Reason 3: The Compliance Dimension

Another gem tucked within the criminal indictment: that the conspirators exchanged messages about their bribery schemes using WhatsApp. So whenever you’re pulling out your hair over recordkeeping procedures to capture employee communications and quietly wondering, “Why do regulators force us to do this impossible thing???” — well, this is why. Because that’s where the corruption happens. 

What we don’t yet know is exactly who did what, and how, to execute this alleged bribery scheme. The charging documents we have in this case are nowhere near as detailed as the settlement documents we usually see in FCPA cases, which typically include enough specific emails and messages to make a compliance officer wince. 

Perhaps those smoking guns will emerge at trial or a future settlement. Right now, however, we have lots of statements from the Adani Group, made to investors and the public over many years, that the company took ethical business seriously and had a robust anti-corruption compliance program. U.S. prosecutors beg to differ, but they haven’t yet shown us where the Adani Group’s actual behavior departed from those vigorous ethical promises it made. Stay tuned. 

Reason 4: The Moral Dimension

One final point that struck me was why the Adani Group allegedly stooped to bribery to win energy supply contracts with states across India: because the product Adani was selling wasn’t worth buying.

Specifically, the Adani Group bid to sell solar power at a fixed price to a state-owned solar energy company in India. That state company, known as SECI, then turned around to sell the energy to various states in India — but those state ministers balked. Why? As the SEC complaint says… 

The problem was economics. The price for energy capacity that SECI had tentatively agreed to pay… turned out to be too high. So, when SECI attempted to contract with the Indian state governments to offload power at prices consistent with the Letters of Award, the Indian states refused. That refusal was only overcome when Gautam Adani, assisted by Sagar Adani, personally intervened and, in the aggregate, paid or promised to pay hundreds of millions of dollars in bribes.

Think about all this from the perspective of the consumers living in those states. They ended up paying more than they should have (in the form of higher taxes or utility bills) to line the pockets of Adani, already one of the richest people in the world. They are the victims of this alleged bribery scheme.

So whenever cynics say bribery is a victimless crime — and let’s not kid ourselves, you know that’s exactly how Trump would view FCPA violations in some far-away country — those people are wrong. Bribery always has victims; they’re just not readily visible victims. They are investors who fell for untrue assurances from management, other companies that lost a business deal they should have won, and consumers who end up paying more for less simply so someone else could enjoy undeserved enrichment.

That’s why the Adani case is worth pursuing. Here’s hoping the incoming Trump Administration will do so.